Yesterday, only one sector eked out a gain during the session, but they all climbed off the lows of the session.
S&P 500 Index | -0.87% | |
Communication Services XLC | -0.29% | |
Consumer Discretionary XLY | -1.13% | |
Consumer Staples XLP | -0.87% | |
Energy XLE | -2.57% | |
Financials XLF | -1.77% | |
Health Care XLV | -1.08% | |
Industrials XLI | -1.48% | |
Materials XLB | +0.33% | |
Real Estate XLRE | -1.17% | |
Technology XLK | -0.30% | |
Utilities XLU | -1.23% |
Interestingly, for all the whining and handwringing, there was a point yesterday when 44% of S&P 500 names were at 52-week highs – the largest percent in two decades.
To see the chart, click here.
NASDAQ Grit
The NASDAQ Composite exhibited quite a bit of grit, rallying back from more than a 2% drubbing out of the gate to finish down 0.09%. The Composite peaked into positive territory three times before coming up just a tad short by the closing bell.
One-Day NASDAQ
The internals, however, did not - as 232 names closed at 52-week lows and only 38 at 52-week highs. In other words, if the goal of the route was to reprice stocks, including bringing all the high-flyers down to earth - then mission accomplished.
Market Breadth | NYSE | NASDAQ |
Advancing | 889 | 1,618 |
Declining | 2,488 | 2,631 |
52 Week High | 75 | 38 |
52 Week Low | 95 | 232 |
Up Volume | 1.99B | 2.45B |
Down Volume | 2.89B | 2.27B |
The selling was intense enough to lure buyers off the sidelines finally, but they were very selective. Meanwhile, after the close, there were huge moves higher to earnings results, which also underscores the notion stocks are oversold enough to celebrate good news, finally.
Today’s Session
I think the initial reaction to CPI was knee-jerk. The key is the baseline to a year ago, as month over month jumps, and a lot of that is pent up demand and should dissipate.
Consumer Prices 4.2% y/y consensus 3.6% and 0.8% m/m consensus 0.2%.
To see the chart, click here.
Excluding food and energy, CPI rose 3% year over year, and 0.9% month over month, versus estimates for 2.3% and 0.3%, respectively.
To see the chart, click here.
April CPI Highlights | M/M | Y/Y |
Boys and Girls footwear | 4.2% | 2.0% |
Watches | 2.5% | 8.2% |
Jewelry | 1.2% | 9.2% |
Used Cars & Trucks | 10.0% | 21.0% |
Sewing Machines | 5.0% | 8.9% |
Computers | 5.1% | 0.9% |
Lodging (Hotels and Motels) | 8.8% | 8.1% |
Car & Truck rentals | 16.2% | 82.2% |
Airfares | 10.1% | 9.6% |
Admission to Sporting Events | 10.2% | -5.5% |
Gasoline | -1.4% | 49.6% |
Portfolio Approach
We closed 3 positions yesterday in our Hotline Model Portfolio and Cash remains at 45%.
